Buying contracts on prediction markets is just another word for “gambling,” says former Trump chief of staff Mick Mulvaney, who leads a coalition that wants state regulators to regulate the growing industry rather than the Federal Commodities Administration.
“The simple answer is it’s gambling. That’s exactly what it is,” Mulvaney told CNBC’s Contessa Brewer, adding that the burgeoning industry needs special oversight in the wake of gambling activity ahead of the Iran war.
“I’ll buy a prediction contract on anything about the Lakers winning a basketball game. If you ask the average person if that’s sports betting, it’s definitely gambling, they’ll say it’s gambling,” the former South Carolina Republican said.
Mr. Mulvaney, who dubbed his new coalition government “Gambling is Not Investing,” argued that the Commodity Futures Trading Commission was “set up to regulate markets” but “not set up to protect consumers,” including those who buy contracts on prediction markets such as Polymarket and Calci.
The CTFC argues that it should become the prediction market regulator, rather than a state agency.
“Look, I used to work for a federal regulator,” Mulvaney said. “I used to run the Consumer Financial Protection Bureau, and I have nothing but the utmost respect for the CFTC, but they don’t do the same job as, say, regulating sports betting.”
Mulvaney also said a recent contract in a prediction market that yielded large profits to buyers who predicted the U.S. would invade Iran should also be investigated.
He also suggested, as did members of Congress, that such activity poses a national security risk to the United States.
“If someone is trading sensitive information in a prediction market and our adversaries are able to extract information about that… how do you address that in terms of our plans as a nation?” Mulvaney asked. “If the Russians, the Chinese, the Iranians are collecting information from prediction markets and it can help them against us, how do we fix it?”
When asked by Brewer who was affiliated with or funded his group, Mulvaney said: “We do not disclose who we are or who funds us. We are not required by law to do so.”
